China hits back at Trump’s tariffs on casinos in its special region

China and the United States continue trading blows in their ongoing trade war. After Donald Trump announced 125% tariffs on the Asian giant, Beijing responded with several retaliatory measures, such as imposing an 84% tariff in return and using TikTok to expose American brands.

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One of the next chapters in this tariff war could involve China forcing the U.S. to sell its casinos in Macau if Trump goes ahead with the forced sale of TikTok and control over the Panama Canal ports. Such a move would be a major blow to three large American companies operating in Macau, one of the most unique regions in the world.

The only place in China where casinos are legal

From the 16th century until 1999, Macau was under Portuguese control, making it the last European colony in Asia. On December 20, 1999, sovereignty over Macau was transferred from Portugal to China. Since then, it has operated under the principle of “one country, two systems.” This means that while it is part of China, it has a separate administrative system, with its own government and economy.

In fact, its official name is the Macau Special Administrative Region of the People’s Republic of China, and one of the most globally recognized differences from mainland China is that gambling is legal in Macau. As a result, it has become the only region in China where casinos are allowed. Every year, millions of visitors come specifically to gamble. Gaming is its main source of income, earning it the nickname “the Las Vegas of Asia”, and since the early 21st century, it has been the largest gambling hub in the world.

Three major U.S. companies operate in Macau

Las Vegas Sands, MGM Resorts, and Wynn Resorts are three companies that run casinos and resort complexes in Macau, and they could lose a significant portion of their business if China ultimately forces the U.S. to sell its casino assets.

Ben Lee, founder of gaming consultancy IGamix, explained that if China follows the same retaliatory strategy it’s been using, there is a growing possibility that American operators will be forced to sell to Chinese businesspeople.

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On the other hand, Nicholas Cheng, managing director at CreditSights, noted that this is still just a possibility, and no official action has been taken by China so far. Another potential move, according to Ben Lee, would be introducing new laws that limit financial transfers from Macau-based subsidiaries to their U.S. parent companies, even if existing casino licenses remain unchanged.